THE Bureau of Customs (BOC) has insisted that its collection of proper duties and taxes on shipments of mechanically deboned meat (MDM) of chicken, particularly the 35-percent tariff difference, is legal.
BOC Assistant Commissioner Vincent Philip C. Maronilla of the Post Clearance Audit Group (PCAG) also said the bureau is open to a dialogue with importers of chicken MDM.
Maronilla’s statement was issued after the Meat Importers and Traders Association (Mita) warned that many of their members could go bankrupt if the BOC pursues the collection of the 35-percent tariff difference.
“Pursuant to Section 430 of the Customs Modernization and Tariff Act [CMTA], the assessment on the said imported goods is not yet final and therefore is still subject to the proper collection of the rightful duties and taxes on the imported goods.
And it is a bigger neglect on the part of BOC not to collect the legally prescribed duties in behalf of the government,” the bureau’s statement read. The BOC also said it is amenable to holding a dialogue with importers and to discussing their concerns.
“BOC is open to a dialogue with the concerned stakeholders in order to come up with a solution to allow us to implement the law correctly and to accommodate some of their concerns,” Maronilla said.
On July 2, the BusinessMirror reported that small meat traders and processors could go bankrupt if the BOC pursues the collection of the 35-percent tariff difference on some imported MDM of chicken, according to Mita.Mita has appealed anew to Socioeconomic Planning Secretary Ernesto M. Pernia to halt the collection of tariffs by the BOC to prevent small importers and processors from going out of business.
Tariffs on MDMs were increased to 40 percent from 5 percent in line with Executive Order 23, Series of 2017. The collection of the higher tariff rate was also agreed upon in a meeting last April between the BOC, Department of Finance, National Economic and Development Authority and the Tariff Commission (TC) in line with the effectivity of Republic Act 11203 or the rice tariffication law in March.
The TC called the meeting after the Philippine Association of Meat Processors Inc. requested the BOC to reinstate the 5-percent tariff on imported chicken MDM.
The decision to implement the 40-percent tariff rate was included in the reply of the TC to the BOC sent on April 16, with the government agencies present during the meeting also agreeing that the difference in duties can still be collected by the BOC.
Last month, the BOC announced that importers of chicken MDM whose shipments were assessed a lower tariff of 5 percent even after the effectivity of the rice trade liberalization law in March will have to pay the government more.
Chicken MDM is a key component for processed meat products, such as hot dogs and canned luncheon meat.